Analysis of Geographic Areas
Microsoft Corp. operates in 2 regions: United States and Other countries.
Area Asset Turnover
Microsoft Corp., asset turnover by geographic area
| Jun 30, 2026 | Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|---|
| United States | 0.57 | 0.63 | 0.67 | 0.93 | 0.94 | 1.10 |
| Other countries | 0.92 | 0.97 | 1.04 | 1.44 | 1.64 | 1.61 |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30).
An analysis of asset turnover across geographic segments reveals a consistent downward trend in efficiency for both domestic and international operations over the observed six-year period. While international markets have historically maintained a higher turnover ratio than the United States, both regions exhibit a significant decline in the ability to generate revenue from their respective asset bases.
- United States Asset Turnover
- The asset turnover ratio in the United States demonstrates a continuous and steady decline. Beginning at 1.10 in June 2021, the ratio decreased to 0.94 and 0.93 in the following two years, followed by a more pronounced drop to 0.67 in 2024. This trajectory continued through June 2026, ending at 0.57, representing a total reduction of approximately 48% over the period.
- Other Countries Asset Turnover
- International operations initially showed stability, with a slight increase from 1.61 in June 2021 to a peak of 1.64 in June 2022. However, a sustained decline followed, with the ratio falling to 1.44 in 2023 and experiencing a sharp contraction to 1.04 in 2024. The downward trend persisted, reaching 0.92 by June 2026.
- Comparative Geographic Performance
- Throughout the entire period, asset turnover for other countries remained consistently higher than that of the United States. However, the gap between the two regions has narrowed over time. A significant synchronized decline is observed between June 2023 and June 2024, suggesting a systemic shift in asset utilization or a period of heavy capital investment that has not yet yielded proportional revenue growth across all geographic areas.
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Area Asset Turnover: United States
Microsoft Corp.; United States; area asset turnover calculation
| Jun 30, 2026 | Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 170,794) | 144,546) | 124,704) | 106,744) | 100,218) | 83,953) |
| Long-lived assets | 300,354) | 230,069) | 186,106) | 114,380) | 106,430) | 76,153) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 0.57 | 0.63 | 0.67 | 0.93 | 0.94 | 1.10 |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30).
1 2026 Calculation
Area asset turnover = Revenue ÷ Long-lived assets
= 170,794 ÷ 300,354 = 0.57
An analysis of the United States geographic area reveals a diverging trend between revenue growth and the expansion of the long-lived asset base, resulting in a consistent decline in asset turnover efficiency from 2021 through 2026.
- Revenue Performance
- Revenue demonstrates a sustained upward trajectory, increasing from 83,953 million US dollars in June 2021 to 170,794 million US dollars by June 2026. This represents a substantial increase in total domestic earnings over the six-year period, reflecting consistent growth in market penetration or service demand.
- Long-lived Asset Expansion
- The investment in long-lived assets has grown at a rate that significantly exceeds the rate of revenue growth. Assets increased from 76,153 million US dollars in 2021 to 300,354 million US dollars in 2026. A notable acceleration in capital deployment is observed between June 2023 and June 2024, during which long-lived assets rose from 114,380 million to 186,106 million US dollars.
- Area Asset Turnover Efficiency
- The area asset turnover ratio exhibits a continuous downward trend, falling from 1.10 in 2021 to 0.57 in 2026. This decline indicates that the capacity to generate revenue from each dollar of long-lived assets has diminished. The sharpest drop occurred between 2023 and 2024, coinciding with the period of most aggressive asset expansion. This pattern suggests a strategy of heavy front-loaded capital investment, where the growth in the asset base has temporarily outpaced the realization of corresponding revenues.
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Area Asset Turnover: Other countries
Microsoft Corp.; Other countries; area asset turnover calculation
| Jun 30, 2026 | Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Revenue | 161,045) | 137,178) | 120,418) | 105,171) | 98,052) | 84,135) |
| Long-lived assets | 175,159) | 141,833) | 115,263) | 72,859) | 59,938) | 52,161) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 0.92 | 0.97 | 1.04 | 1.44 | 1.64 | 1.61 |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30).
1 2026 Calculation
Area asset turnover = Revenue ÷ Long-lived assets
= 161,045 ÷ 175,159 = 0.92
An analysis of financial performance in non-domestic markets reveals a period of aggressive capital expansion accompanied by steady revenue growth. While top-line figures have increased consistently, the rate of investment in long-lived assets has significantly outpaced revenue generation, leading to a measurable decline in asset utilization efficiency over the observed period.
- Revenue Trajectory
- Revenue in other countries exhibited a consistent upward trend, increasing from 84,135 million US dollars in June 2021 to 161,045 million US dollars by June 2026. This represents a sustained growth pattern, indicating a successful expansion of market reach and sales volume across these geographic areas.
- Long-lived Assets Expansion
- A substantial increase in long-lived assets is observed, with values rising from 52,161 million US dollars in 2021 to 175,159 million US dollars in 2026. A significant surge in capital investment occurred between June 2023 and June 2024, during which assets grew by approximately 58%, signaling a period of intensive infrastructure or capacity buildup.
- Area Asset Turnover Efficiency
- The area asset turnover ratio peaked at 1.64 in June 2022, after which a continuous downward trend is evident. The ratio declined to 1.44 in 2023, 1.04 in 2024, and reached 0.92 by June 2026. This decline demonstrates that revenue growth is not keeping pace with the rapid accumulation of long-lived assets, suggesting that the newly acquired assets have not yet reached full operational productivity or that the cost of infrastructure expansion is scaling faster than the associated returns.
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Revenue
Microsoft Corp., revenue by geographic area
US$ in millions
| Jun 30, 2026 | Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|---|
| United States | 170,794) | 144,546) | 124,704) | 106,744) | 100,218) | 83,953) |
| Other countries | 161,045) | 137,178) | 120,418) | 105,171) | 98,052) | 84,135) |
| Total | 331,839) | 281,724) | 245,122) | 211,915) | 198,270) | 168,088) |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30).
Total revenue exhibits a consistent and significant upward trajectory from June 30, 2021, through June 30, 2026. Starting at 168,088 million US$, total revenues are projected to reach 331,839 million US$ by the end of the period, indicating a robust expansion in scale. This growth is characterized by a steady increase in both domestic and international markets, though the rate of expansion varies across the timeframe.
- United States Revenue Performance
- Revenue generated within the United States demonstrates strong growth, increasing from 83,953 million US$ in 2021 to 170,794 million US$ in 2026. The most pronounced acceleration occurs between 2023 and 2026, where annual increments exceed 15,000 million US$ per period, reflecting a strengthening domestic market position.
- International Revenue Performance
- Revenue from other countries follows a similar upward trend, rising from 84,135 million US$ in 2021 to 161,045 million US$ in 2026. While international growth remains consistent, the absolute gains are slightly lower than those seen in the United States, particularly in the latter half of the analyzed period.
- Geographic Revenue Distribution
- A gradual shift in the geographic revenue mix is observable. In 2021, revenue was almost evenly split between the United States and other countries, with the US accounting for approximately 49.9% of total revenue. By June 30, 2026, the United States' contribution is projected to increase to approximately 51.5% of the total revenue mix, suggesting a marginal increase in domestic reliance relative to international markets.
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Long-lived assets
Microsoft Corp., long-lived assets by geographic area
US$ in millions
| Jun 30, 2026 | Jun 30, 2025 | Jun 30, 2024 | Jun 30, 2023 | Jun 30, 2022 | Jun 30, 2021 | |
|---|---|---|---|---|---|---|
| United States | 300,354) | 230,069) | 186,106) | 114,380) | 106,430) | 76,153) |
| Other countries | 175,159) | 141,833) | 115,263) | 72,859) | 59,938) | 52,161) |
| Total | 475,513) | 371,902) | 301,369) | 187,239) | 166,368) | 128,314) |
Based on: 10-K (reporting date: 2026-06-30), 10-K (reporting date: 2025-06-30), 10-K (reporting date: 2024-06-30), 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-06-30), 10-K (reporting date: 2021-06-30).
Total long-lived assets demonstrate a consistent and significant upward trajectory from 2021 through 2026. The most pronounced expansion occurred between June 30, 2023, and June 30, 2024, during which the total asset base grew by approximately 61%, rising from 187.2 billion US$ to 301.4 billion US$. This trend of substantial capital allocation continues through 2026, with total assets reaching 475.5 billion US$, representing a nearly four-fold increase over the analyzed period.
- Domestic Asset Growth
- Long-lived assets within the United States show a strong growth pattern, increasing from 76.2 billion US$ in 2021 to 300.4 billion US$ by 2026. The domestic segment consistently represents the majority of the asset base, with a significant spike observed in 2024, where assets rose by over 62% year-over-year.
- International Asset Expansion
- Assets in other countries have expanded from 52.2 billion US$ in 2021 to 175.2 billion US$ by 2026. While the growth rate is slightly lower than that of the domestic market, the international segment saw its own period of rapid acceleration in 2024, increasing by approximately 58% compared to the previous year.
- Geographic Distribution Stability
- The relative distribution of long-lived assets between the United States and other countries remains remarkably stable. The United States consistently accounts for between 59% and 64% of total long-lived assets, indicating a strategic balance in global infrastructure investment despite the overall scale of expenditure increase.
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